Case-Shiller Data Reveals Ongoing Seller's Market at the National Level

Home prices continue to rise according to the latest results for the S&P CoreLogic Case-Shiller Indices, the leading measure of U.S. home prices. The most recent release reflected data for June 2016. Here are a few highlights1:

  • The S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index reported a 5.1% annual gain in June, unchanged from May.
  • The 20-City Composite also reported a year-over-year gain of 5.1%.
  • Portland, Seattle, and Denver reported the highest year-over-year gains among the 20 cities

The analysis of the data provided by David M. Blitzer, Managing Director and Chairman of the Index Committee at S&P Dow Jones Indices, reveals more about home prices at the regional level.

  • Home prices continued to rise across the country led by the west and the south.
  • The strongest region, the Pacific Northwest, saw prices rise by more than 10%
  • In the Northeast, prices are climbing a bit faster than inflation.
  • Home prices nationally have risen at a consistent 4.8% annual pace over the last two years.

According to Blizter, “Overall, residential real estate and housing is in good shape. Sales of existing homes are running at about 5.5 million units annually with inventory levels under five months, indicating a fairly tight market. Sales of new single family homes were at a 654,000 seasonally adjusted annual rate in July, the highest rate since November 2007. Housing starts in July topped an annual rate of 1.2 million units….”1

Home price growth: Is a more balanced market on the way?

Homeowners are no doubt pleased with increases in home prices, but home buyers may be concerned about affordability, especially as home price growth remains faster than income growth. In addition, home prices have risen at twice the speed as inflation in many parts of the country.2

According to some experts, there are reasons to think than a more balanced market may be on the way:

  • The rate of price growth is slowing in the West. For example, San Francisco area home prices are now growing at about the same as the national average compared to double-digit growth earlier in the year.2
  • The overall inventory of homes for sale remains down. But in a few higher-priced markets, such as San Diego, inventory levels are slowly rising.2

Help for homebuyers in a challenging market

In a seller’s market, it is imperative to work with a mortgage professional who can discuss affordable financing solution with your home-buying clients.

Low down payment loan programs and programs that help with down payment and closing costs are more plentiful than you may think. And, many programs are not limited to first-time buyers. There are also programs that do not require borrowers to fall into “low-to-moderate income” parameters.


Source Material
1. Home Price Gains In June Concentrated In South And West According To The S&P CoreLogic Case-Shiller Indices. S&P Dow Jones Indices.Press Release. 30 Aug.2016. Web. 10 Sept. 2016.
2. Case-Shiller reaction: Housing markets still strongly dominated by sellers. Kelsey Ramírez. Web. 30 Aug. 2016. Web. 10 Sept. 2016.

- By Michael Kearney, Sep 27, 2016